Photo: Duc Anh
Import tariffs are imposed on low quality, cheap imported steel products to protect the industry.
The Ministry of Industry and Trade has eliminated 12 steel projects from the second draft planning of steel production system by 2020, with a vision towards 2035.
The reasons are the poor resources of investors, projects without an investor, lack of material resources, or recommendations from local governments themselves to remove them.
Among 12 of the eliminated projects, Thai Nguyen Iron and Steel expansion project is the largest with a size of 1 million tons of pig iron and 1 million tons of steel billet per year. MoIT indicated that the reason is due to the poor capacity of the investor.
The high-quality steel rolling plant invested in by Kyoei Steel Vietnam Co., in northern Ninh Binh province is the second largest project eliminated from the plan due to long delays. The total capacity of the 12 projects is 1.3 million tons of pig iron and more than 6.5 million tons of steel billet per year.
Under the second draft, the nation's current capacity of the steel industry is 12.6 million tons of pig iron and 12.3 million tons of steel billet per year.
Notably, the $10.6 billion Hoa Sen Ca Na - Ninh Thuan Steel Mill in southern-central Ninh Thuan province, which was invested in by Hoa Sen Group has raised environmental concerns recently but is still included in the plan. However, the names of the investors in the Hoa Sen Group were not mentioned in this plan.
Ca Na-Ninh Thuan Steel Mill will be done in five stages between 2017 and 2031. The steel giant said the first building stage from 2017 to 2018 on an area of 240ha would begin operation in 2019 and produce 1.5 million tons of steel a year.
Previously, the Ninh Thuan People’s Committee approved the Hoa Sen Group to carry out surveys and study plans to construct the infrastructure of Ca Na industrial park and the related steel manufacturing and seaport complex in Thuan Nam district.
Vietnam has officially imposed import tariffs on steel billets and steel bars after more than four months of applying temporary safeguard measures. MoIT released a decision on July 18 applying additional tariffs on imported steel products as an official safeguard measure against cheap imports that threaten domestic steel producers.
The decision will be imposed on alloy and non-alloy steel ingots and steel rods and take effect from early next month and last for four years.
There are now 14 large companies in Vietnam’s steel market with total production accounting for nearly 73 per cent of the total (Hoa Phat holds the most, at 25 per cent), along with hundreds of smaller enterprises manufacturing steel ingots. Twenty-one large enterprises account for nearly 93 per cent of the market share in steel rods, along with dozens of smaller enterprises.
12 projects are eliminated from the second draft planning of steel production system
| 2. Pig-iron production plant of Thien Thanh Construction and Commercial JSC, northern Lao Cai province. 3. Iron-Steel complex of Viet Mineral Trading JSC, northern Cao Bang province. 4. Ha Giang steel mill project, northern Ha Giang province. 5. Son La Iron and Steel billet factory, northern Son La province. 6. Bac Kan Porous iron and steel project of VT&TN Toan Bo Co., northern Bac Kan province. 7. High-quality steel rolling plant of Kyoei Steel Vietnam Co., northern Ninh Binh province. 8. Second phase of Vietnam Italy Steel Plant of Vietnam-Italy JSC, northern Hung Yen province. 9. Quang Binh Cast Iron-Steel Plant of An Trang JSC, central Quang Binh province. 10. HK and CLC Steel Plant of Thu Duc Steel Co., southern Ba Ria-Vung Tau province. 11. Thai Nguyen Iron and Steel expansion project, northern Thai Nguyen province. 12. The second phase of Hau Giang Steel Plant, southern Ha Giang province. |
Source: MoIT's second draft, December, 2016
by Quynh Nguyen / VET
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